Olympic influence by John Gilbert

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John Gilbert, business analyst from JGFR, reviews The London Olympics Barometer winter report which has found that enthusiasm for the Games may be faltering, possibly due to disappointment with the ticket allocation.

For optimists 2012 has many positives going for it. Recently the Chinese have celebrated the start of their New Year – the Year of the Dragon that in Chinese mythology is the king of all animals and a symbol of power, strength and good luck. The stock market is off to a good start and Christmas holiday trading was not as bad as many predicted.

We know that the first quarter will be tough economically, but come the spring there is a lot for people to look forward to. With the 10-point boost to confidence following last year’s Royal Wedding, there is a strong likelihood of similar happening this year as the country joins in the Diamond Jubilee celebrations.

A title-winning showing by England in Euro 2012 and by England’s cricketers –hopefully retaining their number 1 ranking status – together with Andy Murray winning Wimbledon would provide a wonderful sporting entree to the Olympics Opening Ceremony and the start of the Games on July 27^th. Indeed should Andy Murray win an Olympics Gold Medal then the Scots – who are far more lukewarm about the Games – will have something really unique to celebrate.

There is little doubt that the Olympics and Paralympic Games have created a tremendous buzz and desire to be part of it. People these days want to share live experiences and a home Olympics is an once-in-a-lifetime event.

The Olympics Sporting Barometer commissioned from GfK NOP by JGFR however highlights that such has been the success in marketing the Games that there is now a danger of enthusiasm falling away as too many people feel let down and will not now be able to record they were there.

In last March’s Barometer 17% of adults indicated that they would apply for tickets. In the December Barometer only 5% of adults had received tickets with just 5% in London (compared to 35% who applied) and in the South East (34% applying, 10% received). Young people also received far fewer tickets than they applied for, just 2% of 23-29 year olds received tickets with 20% intending to apply. Among top earners who could afford more than most to lay out for tickets, 44% intended applying and only 9% received tickets.

For Olympics sponsors the pressure will be on them to find ways to release more of their tickets to their customers. Around 5% of adults will seek tickets from Olympics sponsors – with most demand set to come from top earners (12%), 16-29 year olds (8%) and people living in the South East (8%) and London and the North East (both 7%).

Most Olympics sponsors now have their promotional campaigns in full swing. However enthusiasm for switching to / purchasing from / regularly use a brand sponsoring the Olympics has faltered in recent Barometers. From 16% of adults in December 2009, the proportion has steadily fallen to just 9% last December. While market conditions are very challenging the loss of consumer appeal close to the main event will be a concern for Olympics sponsors. Non-Olympic sponsors will be watching very carefully, especially how the adoption by Virgin Media in using Usain Bolt to spearhead their latest broadband commercial is perceived.

Since June 2005 there has always only been a minority of the public who believe the Olympics will give a boost to confidence about economic prospects. Just under a quarter of adults believed in an economic boost in December, well down on 40% in August and 30% last March. The costs of hosting the Games have always been a concern. Over the 9 quarters of the survey there are wide regional variations in perception. In London, the belief in an economic boost has been greatest and averaged 31%, in Scotland the expected economic impact is weakest and averaged 24%. The December Barometer found belief about an economic boost in London to be just 23%, slumping from 40% in August and below 29% last March, and little higher than Scotland (21%).

The social impact of the London Olympics is likely to be greater than the economic impact. Almost a half of the population last year believes the Games will bring the country together and make people feel happier. In the 3 Barometers in 2011, this sentiment was at its strongest just after the 365 day countdown began last August. The social impact is felt strongest in the West Midlands, London and in the South East. In the North West, Scotland and Northern Ireland the social impact is weakest.

A key feature of the London Olympics is in recruiting 70,000 volunteers to help with the running of the Games at the various venues, while also generating widespread public involvement through organising events and mobilising communities at a local level to feel part of the national event celebrations.

Since the autumn of 2010 there has been a notable drop in support for volunteering, particularly in the past year with a halving of people intending to volunteer, from a vast army of some 7 million to 3.5 million. Not even last November’s well publicised launch of the Olympic Flame route reversed the fall in volunteers. Londoners (down from 28% in 2010 to 8% last December) have seen a significant decline in volunteers with large numbers of young people also no longer volunteering. Seeing such sharp falls in support in key groups suggests that disappointment with ticket allocations will need to be addressed in London and among young people where creating a legacy is all important.

Creating a sporting legacy and increasing sports participation have received much publicity since the start of the year with the Government accused of changing the goalposts in its measure of sports participation and what it will deem to be a success post the Olympics. On both key measures, a majority of the public (55% / 65%) believe they will be achieved with little change of view over the past 2-3 years.

For marketers the public’s attitude towards the Olympics needs careful monitoring. Sport this summer could provide the platform for a surge in national pride with the eyes of the world on London and a major boost to sentiment and economic activity. What is essential is that the public remain positive about the Games and that the problems with ticket allocation do not backfire on Olympics sponsors who find they are besieged with customers wanting tickets.

The Winter Olympics Barometer report is now published. The next two Olympic Barometers will be in March and June.